Share buybacks have become very popular since the 1990s. When a company pays out a dividend to its shareholders the final amount that the shareholder receives is significantly less compared to the money paid out, due to taxes. If you invest abroad there are taxes due in the country where the company is listed, ad in the country of residence. Double tax agreements exist but it's not always easy to claim these taxes back.
A much more tax-efficient way of paying out to shareholders is for the company to repurchase and destroy shares. If a company has 100 shares and buys back 10%, the shareholder with 10 shares effectively owns 11,1% of the company after this operation. This means that he's entitled to a larger share of future earnings and distributions to the shareholders.
A company buying back shares is a signal that the company's management believes the shares are trading at a discount compared to fair value.
Buyback Yield is calculated as follows: